The past few years have seen an explosive growth of subscription boxes in the US. Online visits to pure players have risen almost nine-fold, from 4.7 million visits in April 2014 to 41.7 million in April 2018. This has since slowed, with the first four months of 2018 seeing only a 3% increase YoY.

But the most successful subscription businesses know that boxes are by no means fading away, the industry is just maturing. In Q1 2018, a record 18.5 million individuals visited at least one subscription site, which is up 24% YoY. Using Hitwise data, we uncover what has happened and why. Using examples from Blue Apron, Graze, FabFitFun and Kiwi Co, we look at the categories and brands driving growth to reveal the most successful subscription businesses.

Most Successful Subscription Businesses Dominate, but Share Has Dropped

The top ten subscription box sites accounted for 61% of the industry’s online visits in April 2018. However, this dominance is dropping – visit share has declined from 70% last April, suggesting that competition is rising from below. Additionally, only four of the top ten sites have grown over this period.

Traditional Categories Slowed, Niche Categories on the Rise

As categories enter maturity, online visits have slowed over the past year. In particular, visits to Beauty subscription box players have declined by 1% in April YoY. But not all verticals have followed this same pattern. Smaller, niche categories, such as Kids (+24%) and Apparel (+20%), continue to rise.

Mixed Results for Top Players in Food and Beauty, Growth for Kids

Which players drove this subscription box category growth or decline? For Food, the largest category, visits rose by 8% in April YoY. Blue Apron remained the leader but lost 20% of its traffic, with Hello Fresh at their heels with a 37% rise.

As the second largest category, Beauty was the only vertical to see a drop of -1% in April YoY. This was reflected across the top five players, except for FabFitFun which grew by 120%.

As the smallest category, Kids is still in expansion mode, rising by 24% in April YoY. Kiwi Co had a significant lead but others are catching up, suggesting there is opportunity for new players to enter this category.

Overall, the subscription box industry is flattening but there is room for new players. The most successful subscription businesses will keep an eye on growth categories, where there’s room for innovative brands to step in.

This report was excerpted from our Subscription Box Report, which details the subscriber audience and tactics for subscription brands to acquire new customers. ___Source: Hitwise Data, based on custom industry of over 300 leading subscription box brands on mobile and desktop devices. Top players based on visit share by category from Hitwise April 2018.